Essays on Online and Multi-Channel Marketing

Firms increasingly adopt online and multi-channel marketing strategies to reach and persuade consumers. Therefore, designing an effective marketing mix is critical to their success. The aim of my dissertation is to understand the strategy behind firms’ channel choices and assess marketing effectiveness. It consists of three large-scale empirical studies examining several important aspects of online and multi-channel marketing. My first essay focuses on the business-to-business (B2B) interactions involving online platforms, which serve as new channels for traditional merchants to reach consumers and grow business. Using data from the daily deal market, we specify a structural model that examines consumer choices on the demand side and firm strategies on the supply side. In particular, we incorporate merchant heterogeneity and allow prices to be jointly determined by merchants and platforms through negotiation; both of these match the real-world complexity but are challenging to be modeled theoretically. Our results show how platform size, commission rate, and the allocation of price-bargaining power jointly determine the price setting and the platform differentiation among merchants